Micron taps Taiwan’s Powerchip to accelerate DRAM output amid global shortage

Facing surging AI-led demand and long fabrication timelines, Micron is partnering with Taiwan’s Powerchip Semiconductor to quickly add DRAM capacity, aiming to boost output by up to 15% while easing pressure on constrained global memory supply chains.

Micron Technology has moved to fast-track its DRAM manufacturing capacity by entering into a strategic partnership with Taiwan-based Powerchip Semiconductor Manufacturing Corp. (PSMC), as global demand for memory continues to outstrip supply.

The collaboration gives Micron access to an existing DRAM fabrication facility in Taiwan, allowing the US-based memory maker to expand production far more quickly than relying solely on new greenfield fabs, which typically take several years to become operational.

“This strategic acquisition of an existing cleanroom complements our current Taiwan operations and will enable Micron to increase production and better serve our customers in a market where demand continues to outpace supply,” said Manish Bhatia, Executive VP of Global Operations at Micron Technology.

Faster capacity expansion through existing fabs

Under the $1.8 billion deal, Micron will gain access to PSMC’s P5 fab in Tongluo, Taiwan—a 300,000-square-foot facility currently supporting legacy DRAM manufacturing. Both companies will continue working on mature DRAM technologies at the site, with Micron integrating the output into its broader supply network.

While Micron has not disclosed detailed production metrics, the company confirmed that the facility is expected to begin delivering meaningful DRAM output in the second half of 2027. Industry sources estimate that once fully operational, the fab could manufacture up to 50,000 12-inch wafers per month, potentially increasing Micron’s annual DRAM output by 10% to 15% within a few quarters.

AI demand intensifies memory supply pressure

The move comes as AI infrastructure spending places unprecedented strain on the memory market. High-performance computing, data centers, and AI accelerators are consuming a growing share of global DRAM supply, leaving consumer electronics, PCs, and other segments increasingly exposed to shortages.

By leveraging existing manufacturing capacity in Taiwan, Micron aims to stabilize supply for key customers while buying time as its large-scale US investments—including new fabs in Idaho and New York—progress toward production later in the decade.